Stocks are at records, but it’s no longer the ‘Trump trade’

Associated Press

NEW YORK

The stock market has never been higher, and President Donald Trump would like more people to pay attention.

“Stock Market could hit all-time high [again] 22,000 today,” Trump tweeted Tuesday about the Dow Jones industrial average, before it ended the day at a record 21,963.92. “Was 18,000 only 6 months ago on Election Day. Mainstream media seldom mentions!”

The 18,000 figure he cited was inaccurate: The Dow closed at 19,890.94 six months ago. It was at 18,332.74 on Election Day. And analysts say it would be inaccurate to give Trump full credit for the market’s recent records.

“Trump obviously is taking credit for a lot of this, as almost any president would do, but the things that affect the market right now aren’t things that have been put in place over the last six months,” said Randy Frederick, vice president of trading and derivatives at the Schwab Center for Financial Research.

Stocks did surge after Trump’s electoral win in November following a couple of hours of confusion among investors caught off-guard by the voting results. The hope was that Trump and a Republican-controlled Congress would cut regulations, revamp the tax system, launch a big program for infrastructure and enact other pro-business policies.

Areas of the market that would benefit most from such policies soared much more than the rest of the market, and the effect was so strong that traders called it the “Trump trade.”

In recent months, though, Washington has had several high-profile stumbles, highlighted by the Senate’s latest failed attempt to repeal the Affordable Care Act. That inaction has investors pushing back their expectations for when a tax plan and other policy changes could happen, and some are questioning how big those changes can be given Republicans’ struggles. So the Trump trade has not only faded but reversed course, with the initial leaders and laggards flipping places.